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We're bringing in now Angelo Zino, uh, for more reaction on alphabet. He, of course, is senior economic analyst at CFRA Research. Angelo, it's good to see you. Uh, so alphabet reports, the stocks kind of all over the place here in the after hours. Angelo, we dipped initially. Now we're actually up by about 1%. Get your your reaction, your response to these numbers.

Yeah, listen, Josh. I think overall, the the results were solid. It's, I guess, the best way I can put it, right? I mean, I think investors in recent quarters have kind of been hoping or looking for kind of these nice beaten raises at some of these big tech names. And this one was kind of more of an inline type quarter, especially after, uh, you know, Google posted some great results after their Q1 results. But that said, um, you know, stronger than expected numbers in terms of their search business, that kind of offsets some softness on the YouTube side of things, but YouTube still is growing at a healthy double-digit pace, nonetheless. And then on the cloud side of things, definitely beat our expectations for growth of about 25% or so. So, um, you know, overall, you when you kind of look at the on a kind of operating segment perspective, you know, some mixed results there, at least relative to expectations, but nonetheless, I would kind of call it very solid. And then when we kind of look at the margin side of things, I think that's really an under under appreciated story as far as kind of alphabet is concerned. They, you know, posted operating margins. I believe about 32% or so, kind of the highest level they've had since kind of post since kind of the pandemic levels. And, um, you know, especially on the cloud side of things, I think the operating margin number was 11%, which is the highest number we've seen actually from that segment. So they're doing a pretty good job on that side of things, scaling the business, um, benefiting from kind of the, you know, clearly the higher revenue and kind of sustaining some of those OX numbers.

Angelo, um, to get back to YouTube ads for just a minute, and I know this is a relatively small part of the overall revenue pie, but why do you think that was a little bit weaker than anticipated?

You know, I think it it's I think it's possibly that, you know, some some analysts out there might have gotten a little bit kind of overly optimistic after their kind of YouTube strong beat after Q1 results. They they grew north of 20%. That was really kind of a peak year-over-year type number on the YouTube side of things. Digital ad spend continues to be very healthy. Uh, you kind of look at how they're monetizing that business overall. It continues to be, you know, we think there are a lot of kind of opportunities for them to monetize, specifically kind of some of those shorter form videos which they're finding some success on here as of late. But, um, again, the the numbers from the growth perspective for YouTube looked pretty good. Um, they're also lapping, you know, some price increases and stuff like that on kind of the NFL Sunday ticket package. So, you know, it might be a combination of of of issues out there, but nonetheless, the the numbers overall were still pretty strong for YouTube.

What about the moves, Angelo, this company's making in AI? Just as a financial analyst, how how are you thinking through that? How how excited should investors be about that?

Yeah, so as far as AI is concerned, listen, it's pretty incremental at this point in time, right? I mean, you're not necessarily seeing this massive pivot pivot in terms of AI at this point in time in terms of in terms of monetizing AI, but you're seeing kind of some fruits, you know, fruits from their investments out there, specifically on the cloud side of things, you know, as they kind of get more of those that capacity online in terms of those GPUs and the next gen CPUs out there. So you're seeing it kind of support better than expected numbers on on the cloud side of things. And then specifically as we kind of start looking on on a search and YouTube businesses, um, you know, clearly they're they're starting to implement AI across those segments out there. I think AI overviews, you know, specifically is something that analysts are going to kind of want to see, you know, how that's coming along here since that was really kind of just launched on a widespread perspective here in Q2. So we kind of want to see, you know, what they have to say about kind of the ROI ROI out there as from the perspective of advertisers and, um, how they're looking how they're monetizing that at least here initially.